A new report entitled ‘Cityscape’ by real estate advisors, Colliers International, highlights how Manchester’s residential property demand is forecast to outstrip supply, particularly for high-quality residential real estate in the city centre.
Analysing the proposed development pipeline, the Cityscape report suggests that 4,000 new purpose-built residential property units across 12 developments will be built and scheduled for delivery between 2018 and 2022.
However, during that same period, figures suggest that 11,000 new jobs will be created in key sectors including technology, healthcare, media and telecoms, government, legal, banking and insurance sectors. Millennials and generation ‘Z’ graduates are expected to be the main beneficiaries of these new jobs.
Despite heavy investment from buyers across the world, Manchester’s central property market is not matching up to the level needed to cope with the demand.
New research suggests that up to one third of “millennials”, those born between 1980 and 1996, will now rent their entire lives. Over 40% will still be renting by the age of 30, twice as many as “Generation X” (those born between 1965 and 1980). This trend is not only limited to the UK’s young. Over the last 15 years, the number of families living in the UK’s private rental sector has also tripled; 1.8 million families are estimated to now rent their homes.
One of the reasons for an increase in rental demand is the shift in generational attitudes towards ownership.
Whilst there are many people who wish to buy a home, but rely on renting as a means of saving money to make it onto the property ladder, others prefer to enjoy the flexibility that renting offers to pursue a more mobile lifestyle.
Both scenarios are placing serious concerns on the country’s rental market particularly in those cities where rental accommodation is in high demand, and where tenants expect quality residential properties.
Ronald Garrett, Global Sales Director at Alliance Investments said “Manchester has one of the youngest populations in the country. A quarter of Manchester’s entire population is aged 20-29 which is a key demographic for the city’s rental sector. At Alliance, we are committed to bridging the gap by supplying high quality new-build developments to meet the demand.”
Manchester Residential Property Demand Growing
The population is growing 15 times faster than new homes are being built. Moreover, Manchester’s 58% graduate retention rate delivers 20,000 new workers in the city annually.
By 2022, residential housing in Manchester will meet just 25% of annual demand. As a result, rental rates are likely to maintain their upward trajectory. Property consultants, JLL, forecast that rents in Manchester will grow 40% faster than the UK average by 2022.